HDFC SIP - Top HDFC Mutual Fund Schemes for SIP Investment

HDFC Mutual Fund AMC is one of the top fund houses in India which offers a wide range of mutual funds like equity, hybrid, and debt to cater to all types of investment needs of the investors. As a lucrative investment instrument, the investors can plan to make an investment in any of the HDFC Mutual fund schemes either through the process of HDFC SIP or by the lump-sum method.  

The Systematic investment plans offered by HDFC are not only flexible but can also be availed easily.  Thus, it is one of the best choices for those investors who want to create wealth through investments in the mutual fund. According to the existing rule, one can choose to invest through HDFC SIP for the term period of his/her choice and can start with any amount subject to the minimum requirement of SIP investment.

How Does HDFC Mutual Fund SIP Works?


HDFC Mutual Fund SIP works similarly as any other SIP plan, wherein the investors have to invest a fixed amount at HDFC mutual fund scheme at a particular interval of time. According to one’s own choice, the investor can decrease or increase the term period of SIP depending on the scheme they are investing in. The minimum investment limit in HDFC mutual fund SIP is Rs.500. In order to start the investment in HDFC mutual fund SIP all one need to do is to set up ECS mandate or submit the postpaid cheque at fund/distributor fund house representative office.
 

Benefits of Investing in HDFC Mutual Fund SIP


1. Initiates Disciplined Investments

HDFC Mutual Fund SIP investment provides an opportunity for the investors so that they can plan an annual investment goal in order to achieve their long-term and short-term financial objectives. This is mainly because SIP schemes provide a disciplined approach towards investment where the investors make sure to invest a predetermined amount periodically in the fund.  HDFC Mutual Fund SIP is not constricted to the amount of investment but with a disciplined, long-term and periodical investment approach. HDFC Mutual fund SIP results in much better long-term investment option as compared to regular investments.

2. The benefit of Rupee Cost Averaging

According to the market fluctuation, the price of HDFC mutual fund that the investors are investing on is likely to change on a daily basis. However, as the amount invested in SIP is fixed, with the help of rupee cost averaging the investors can buy more unit when the market share price is low and lesser units when the market share price is high.  For instance, let’s assume that an investor makes a monthly SIP investment of Rs.1000. The price of the unit will be INR 5 during the first installment of SIP, so the investors can purchase 200 fund units.  Let’s say the price of the unit increases to Rs.10 during second SIP installment, thus, the investor can purchase 100 units of the same fund. Therefore, with a total of 300 units, the investor can gain profit at the time of redeeming the unit, as the average unit price of the unit will be lower than the new higher price of the units.

3. The flexibility of Investment Tenure

The investors have the flexibility to choose the tenure of investment according to their own requirement and suitability. One can make HDFC SIP investment for a minimum tenure of 6 months and a maximum tenure of their own choice. Moreover, one can also increase or decrease the tenure of SIP investment according to the target of investment or due to any other requirement. Besides, the advantage to change the tenure of HDFC SIP investment, the investor can also log in to their mutual fund investment account and discontinue any ongoing SIP without worrying about the penalties that can occur in case if the investor will have to stop their recurring deposit of bank prematurely.

4. The Flexibility of Investment Amount

One can start investing in HDFC Mutual Fund SIP with a minimum amount of Rs.500 to the maximum amount of their own choice that suits their investment goals. Moreover, one can invest in more than one SIP scheme simultaneously and can also increase or decrease the amount of investment according to one won choice and suitability. The flexibility of investment amount helps investors to invest in HDFC Mutual Fund SIP scheme in an easy and hassle-free way.

5. Offer Benefit of Long-Term Investment

SIP enables the investors the benefit of the power of compounding if one starts investing at an early stage of life. The principal amount along with interest/dividend reinvested per year helps to multiply the money much rapidly and provides a good return on investment over a long period of time. Moreover, in SIP investment the money is majorly invested in equity and equity related instruments which are best for long-term investment. With an objective of long-term investment, the amount invested in Mutual Fund SIP always has an option to overcome the market fluctuations and offer long-term capital gain to the investors.

6. Provides Minimum Effort to Gain High Returns

HDFC Mutual Fund SIP enables the investors to derisk their portfolio of investment as they don’t need to time the market.  Investment in SIP takes minimum effort as the predetermined amount is deducted automatically per month from the investors account and is invested in the funds choice of the investors. By contributing a minimum amount towards HDFC Mutual Fund SIP on a regular basis, the investors can gain high return on investment and can achieve the long-term and short-term goals of life. even by investing the mining amount one can end up growing their wealth and creating a financial cushion in a long run.

Top HDFC Mutual Fund Schemes for SIP Investment


There is a wide range of mutual funds schemes offered by HDFC Mutual Fund AMC that provides high returns to the investors whether one invests through the method of lump-sum payment or through the process of SIP. Here are the best equity funds offered y HDFC Mutual Fund AMC in which the investors can invest through the process of systematic investment plan according to create wealth and gain long-term investment return.

For the better understanding of our customers here we have taken a tabular comparison of the below mentioned HDFC SIP funds across different criteria.

In order to provide a proper illustration, each HDFC SIP investment amount is taken as Rs.2000 per month which is equal to a total of Rs.24,000 yearly. The starting date of SIP for the purpose of computation is fixed as 1st August 2016 and the end date is fixed as July 2017.  The maturity amount is according to the fund’s net asset value recorded on 18th August 2017. The HDFC SIP returns are based on the past data of each fund of the regular plan and do not guarantee the future performance.

Fund Name

1 Year Return

3 Years Returns

5 years Returns

Total SIP Investment

SIP Maturity Value

HDFC Small Cap Fund

22.06%

18.48%

21.58%

Rs.24,000

Rs.27,689

HDFC Prudence Fund

15.51%

10.97%

17.42%

Rs.24,000

Rs.26,513

HDFC Capital Builder Fund

17.78%

13.83%

19.40%

Rs.24,000

Rs.26,953

HDFC Long Term Advantage Fund

19.57%

12.16%

18.81%

Rs.24,000

Rs.27,205

HDFC Tax Saver Fund

18.68%

10.21%

17.82%

Rs.24,000

Rs.27,607



1. HDFC Small Cap Fund

HDFC Small Cap fund is one of the best schemes offered by HDFC mutual fund AMC. The main objective of HDFC Small cap fund is to provide capital appreciation in long-term, under this fund option the money is invested majorly in equity and instruments related to equity in top small and mid-cap companies.  This fund is best suited for individuals who have a high-risk appetite and want to have long-term capital growth through investment in equity instruments. HDFC Small Cap Fund is an open-ended growth scheme which is managed by fund managers Rakesh Vyas and Vinay R Kulkarni.

2. HDFC Long Term Advantage Fund

This is an open-ended equity scheme which aims to provide capital appreciation in the long-term by making an investment in equity and instruments related to the equity market. The fund is managed by fund managers Rakesh Vyas and Chirag Setalvad. This fund is best suited for individuals who have a moderately high-risk appetite and want to gain a long-term return on investment.

3. HDFC Prudence Fund

This is an open-ended balanced scheme which the main objective is to provide long-term wealth creation along with the benefit of periodic return by making an investment in a prudent combination of equity instruments and debt, with an aim to prevent/minimize the loss of capital. With moderately high risk this fund option is best suitable for investors who want to have a continues flow of income along with the wealth creation, guaranteeing that their money will remain safe from losses occur due to market fluctuations in a long run. HDFC Prudence fund is managed by the fund managers Rakesh Vyas and Prashant Jain.

4. HDFC Tax Saver Fund

This is an open-ended scheme that aims at providing long-term capital growth along with the benefit of periodic income by making an investment in equity and equity related instruments. As an equity-linked savings scheme, HDFC Tax Saver Fund also provides tax benefit up to the maximum limit of Rs.1,50,000 under section 80C of Income Tax Act.  As one of the safest options for tax saving investment the fund majorly invests in the large-cap fund. HDFC Tax Saver Fund is managed by fund manager Vinay R Kulkarni and Rakesh Vyas.

5. HDFC Capital Builder Fund

HDFC Capital Builder Fund offered by HDFC Mutual Fund AMC is an open-ended growth scheme which aims at providing long-term wealth appreciation by making investment majorly in equity and instruments related to equity. This fund option is best suited for those individuals who have a high-risk appetite and wants to have long-term capital growth. HDFC Capital Builder fund is managed by the fund manager Miten Lathia. The fund is categorized as a multi-cap equity fund, which follows the process of market cap agnostic to invest in equity instruments.

HDFC SIP FAQ


1: What is SIP (Systematic Investment Plan)?

Ans- Systematic Investment Plan is a process through which the investors can invest a fixed amount per month on a particular date in the mutual fund scheme in order to create wealth and achieve long-term financial goals of life.


2: How to enroll in Systematic Investment Plan?

Ans- In order to enroll in systematic investment plan the first thing the investors need to do is to fulfill the KYC requirement. Along with the KYC the investor will have to submit important documents like address proof, identity proof, and a photograph.  The investors are also required to confirm his/her physical existence through In-Person Verification. The investors can create mutual fund SIP via mPowered trading group/mobile app.


3: When is the right time to start SIP or can SIP investment can be done when the market is high?

Ans- One can start investing in SIP at any given point of time and does not require to time the market. In SIP, the investors can buy fewer units of the mutual fund during the time when the market is high and when the market is low they can buy more number of units in the same amount. Thus, the investors do not require to wait for the right time to invest in SIP.


4: Does SIP investment has an upper limit?

Ans- No, this is a misunderstanding that systematic investment plan can only be done by investing a small amount. One can start investing in systematic investment plan with a minimum of Rs.500 and can invest up to as much as the amount they want to invest. SIP investment does not include an upper limit. With the benefit of compounding one can accumulate more wealth and can earn higher returns on investment by making large investments.